There was a safeguarding issue where a child was creating his own public channel for a mix of things including grand theft auto clips. Then he was typing to anyone around the world in comments and lots of swearing etc. They clearly thought he was older. He was a capable child re reading and writing although it was v immature.
Two other situations have been where children are awake all night watching/ playing and then sleep in the day. One had to have social work intervention at home and a strict routine at school to reverse this.
However I completely understand the situation you're in.
I've taught children where there's clearly been an understanding around what is and isn't allowable but those children seemed to be more able to negotiate. And they've learnt huge amounts of fantastic science etc.
Most of my experience probably pre dates YouTube kids and also certain algorithms settings.
My 8 yr old has only found it in the last year (via seesaw as videos went straight to YouTube.) but we eventually allowed YouTube kids with restrictions on and strict time limits. I'm still not keen on the format but all his friends watch it and to be fair, he's built things in minecraft watching a video on how to do.
I do know about a particular issue with videos by trans identifying teens being watched by children with autism (possibly undiagnosed) who feel differently and so begin to think "this is me." As with some neurotypical children/ teens. A young woman I know was about to get surgery etc till she realised she was gay.
It's a double edged sword. My niece is autistic and has binged "girly stuff" on YouTube but it has helped her to understand how to fit in better with her peers. And I know that adults with autism have described how helpful it is.
I think I'd be strict with time limits, and also content if its causing distress.
Computers in general can be a difficult area, I taught one child who almost seemed to be dealing with physical withdrawal if he had to come off when asked. We introduced rewards that were time based with sand timers and he was much better. I don't know if rewards would work at home but certainly timers could be helpful.